Category: 3. Business

Consumers in the UK are expected to suffer the highest inflation in the G7 group of leading economies this year and next, the International Monetary Fund has warned.

As policymakers gathered in Washington for its annual meetings, the IMF said prices would rise in Britain at a faster pace in 2025 and 2026 than it had originally forecast at its last update in July.

According to the fund’s latest World Economic Outlook (WEO), published on Tuesday, UK inflation is on course to average 3.4% this year, up from its previous estimate of 3.2%, and then slow slightly to 2.5% next year, up from its old prediction of 2.3%.

As Rachel Reeves prepares to fly into the US capital in the run-up to her crunch budget next month, the IMF’s experts cited “sticky” inflation as one reason yields, or interest rates, on UK government bonds have been rising.

The chancellor intends to use tax rises and spending cuts in the budget to build up a larger financial buffer against her fiscal rules, in part to insulate the government from bond market instability.

Asked about market pressures on the UK at a press conference in Washington, the IMF’s deputy director for monetary and capital markets, Athanasios Vamvakidis, said: “Clearly markets are concerned about the UK economy, and we have seen more volatility in the UK compared to other advanced economies.”

Pointing to above-target inflation and weak productivity, he added: “The market is asking for more details on the fiscal plans in the UK: so yields, as a result, are higher in the UK compared to other advanced economies.”

The IMF modestly increased its forecast for economic growth in the UK for this year, from 1.2% to 1.3%, and slightly downgraded it for 2026, also to 1.3%, amid concerns over the labour market.

Over the year as a whole, the economic body expects the UK to be the second fastest-growing economy in the G7, behind a 2% expansion of gross domestic product (GDP) in the US.

IMF graphic

The IMF’s chief economist, Pierre-Olivier Gourinchas, said many of the drivers of UK inflation were “temporary factors,” such as water bills and rail price rises.

“So we expect this will moderate going forward but there are risks,” he said, citing higher than expected wage growth, and households and companies becoming less certain that inflation will come down.

“The path forward for the Bank of England should be very cautious in its easing trajectory and make sure that inflation is on the right track,” Gourinchas added, implying that policymakers should not cut interest rates too quickly.

The WEO figures highlight the challenge the Bank’s nine-member monetary policy committee faces in getting headline inflation back to its 2% target. According to the latest official figures, UK consumer price index inflation was 3.8% in August, and in September the Bank forecast CPI would peak that month at 4%.

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The IMF also upgraded its forecast for global GDP growth this year to 3.2%, from 3% at its July forecast. It said the world economy has shown “unexpected resilience” in the face of Donald Trump’s tariffs, but the full impact was yet to be felt and the outlook remains “dim”.

It said the tariffs imposed were less extreme than initially feared after Trump’s “liberation day” announcements in April and their impact masked by households and companies bringing forward consumption to beat their introduction.

However, the report pointed to a series of concerns about the global outlook, including the risk to US growth from Washington’s immigration crackdown; “stretched valuations” in stock markets; and the fact the full effects of the tariffs are only now beginning to show.

Echoing a speech by the IMF managing director, Kristalina Georgieva, last week, the WEO report warned of the risks of a “correction,” in share prices – and a downturn investment – if markets reassess the likely gains from generative AI.

The fund made a similar warning in its global financial stability report, arguing that US stock markets, which have rallied during the artificial intelligence boom, are “complacent” about the risk of a “sudden, sharp correction”.

Responding to the improved forecast for UK growth this year, the chancellor, Reeves, said: “This is the second consecutive upgrade to this year’s growth forecast from the IMF. It’s no surprise, Britain led the G7 in growth in the first half of this year, and average disposable income is up £800 since the election.”

Thank you, Emily. And thank you to the National Association for Business Economics for the Adam Smith Award. It is an honor just to be mentioned alongside past recipients, including my predecessors Janet Yellen and Ben Bernanke. Thank you for this recognition and for the opportunity to speak with you today.

Monetary policy is more effective when the public understands what the Federal Reserve does and why. With that in mind, I hope to enhance understanding of one of the more arcane and technical aspects of monetary policy: the Federal Reserve’s balance sheet. A colleague recently compared this topic to a trip to the dentist, but that comparison may be unfair—to dentists.¹

Today, I will discuss the essential role our balance sheet played during the pandemic, along with some lessons learned. I will then review our ample reserves implementation framework and the progress we have made toward normalizing the size of our balance sheet. I will conclude with some brief remarks on the economic outlook.

Background on the Fed’s Balance Sheet

One of the primary purposes of a central bank is to provide the monetary foundation for the financial system and the broader economy. This foundation is made of central bank liabilities. On the Fed’s balance sheet, the liability side of the ledger totaled $6.5 trillion as of October 8, and three categories account for roughly 95 percent of that total.² First, Federal Reserve notes—that is, physical currency—totaled $2.4 trillion. Second, reserves—funds held by depository institutions at the Federal Reserve Banks—totaled $3.0 trillion. These deposits allow commercial banks to make and receive payments and meet regulatory requirements. Reserves are the safest and most liquid asset in the financial system, and only the Fed can create them. The adequate provision of reserves is essential to the safety and soundness of our banking system, the resilience and efficiency of our payments system, and ultimately the stability of our economy.

Third is the Treasury General Account (TGA), currently at about $800 billion, which essentially is the checking account for the federal government. When the Treasury makes or receives payments, those flows affect dollar-for-dollar the supply of reserves or other liabilities in the system.³

The asset side of our ledger consists almost entirely of securities, including $4.2 trillion of U.S. Treasury securities and $2.1 trillion of government-guaranteed agency mortgage-backed securities (MBS).⁴ When we add reserves to the system, we generally do so by purchasing Treasury securities in the open market and crediting the reserve accounts of the banks involved in the transaction with the seller. This process effectively transforms securities held by the public into reserves but does not change the total amount of government liabilities held by the public.⁵

The Balance Sheet Is an Important Tool

The Fed’s balance sheet serves as a critical policy tool, especially when the policy rate is constrained by the effective lower bound (ELB). When COVID-19 struck in March 2020, the economy came to a near standstill and financial markets seized up, threatening to transform a public health crisis into a severe, prolonged economic downturn.

In response, we established a number of emergency liquidity facilities. Those programs, supported by Congress and the Administration, provided critical support to markets and were remarkably effective in restoring confidence and stability. At their peak in July 2020, loans from these facilities totaled just over $200 billion. Most of these loans were quickly unwound as conditions stabilized.⁶

At the same time, the market for U.S. Treasury securities—normally the deepest, most liquid market in the world and the bedrock of the global financial system—was under extraordinary pressure and on the verge of collapse. We used large-scale purchases of securities to restore functionality to the Treasury market. Faced with unprecedented market dysfunction, the Fed purchased Treasury and agency securities at an extraordinary pace in March and April of 2020. These purchases supported the flow of credit to households and businesses and fostered more accommodative financial conditions to support the recovery of the economy when it ultimately came.⁷ This source of policy accommodation was important as we had lowered the federal funds rate close to zero and expected it to remain there for some time.

By June 2020, we slowed our purchase pace to a still substantial $120 billion per month. In December 2020, as the economic outlook remained highly uncertain, the FOMC said that we expected to maintain that pace of purchases “until substantial further progress has been made toward the Committee’s maximum employment and price stability goals.”⁸ That guidance provided assurance that the Fed would not prematurely withdraw support while the economic recovery remained fragile amid unprecedented conditions.

We maintained that pace of asset purchases through October 2021. By then, it had become apparent that elevated inflation was not likely to go away without a strong monetary response. At our meeting in November 2021, we announced a phaseout of asset purchases. At our next meeting in December, we doubled the pace of the taper and said that asset purchases would conclude by mid-March of 2022. Over the entire period of purchases, our securities holdings increased by $4.6 trillion.

A number of observers have raised questions, fairly enough, about the size and composition of asset purchases during the pandemic recovery.⁹ Throughout 2020 and 2021, the economy continued to face significant challenges as successive waves of COVID caused widespread disruption and loss. During that tumultuous period, we continued purchases in order to avoid a sharp, unwelcome tightening of financial conditions at a time when the economy still appeared to be highly vulnerable. Our thinking was informed by recent episodes in which signals about reducing the balance sheet had triggered significant tightening in financial conditions. We were thinking of events of December 2018, as well as the 2013 “taper tantrum.”¹⁰

Regarding the composition of our purchases, some have questioned the inclusion of agency MBS purchases given the strong housing market during the pandemic recovery.¹¹ Outside of purchases aimed specifically at market functioning, MBS purchases are primarily intended, like our purchases of Treasury securities, to ease broader financial conditions when the policy rate is constrained at the ELB.¹² The extent to which these MBS purchases disproportionately affected housing market conditions during this period is challenging to determine. Many factors affect the mortgage market, and many factors beyond the mortgage market affect supply and demand in the broader housing market.¹³

With the clarity of hindsight, we could have—and perhaps should have—stopped asset purchases sooner. Our real-time decisions were intended to serve as insurance against downside risks. We knew that we could unwind purchases relatively quickly once we ended them, which is exactly what we did. Research and experience tell us that asset purchases affect the economy through expectations regarding the future size and duration of our balance sheet.¹⁴ When we announced our taper, market participants began pricing in its effects, pulling forward the tightening in financial conditions.¹⁵ Stopping sooner could have made some difference, but not likely enough to fundamentally alter the trajectory of the economy. Nonetheless, our experience since 2020 does suggest that we can be more nimble in our use of the balance sheet, and more confident that our communications will foster appropriate expectations among market participants given their growing experience with these tools.

Some have also argued that we could have better explained the purpose of asset purchases in real time.¹⁶ There is always room for improved communication. But I believe our statements were reasonably clear about our objectives, which were to support and then sustain smooth market functioning and to help foster accommodative financial conditions. Over time, the relative importance of those objectives evolved with economic conditions. But the objectives were never in conflict, so at the time this issue appeared to be a distinction without much of a difference. That is not always the case, of course. For example, the March 2023 banking stress led to a sizable increase in our balance sheet through lending operations. We clearly differentiated these financial stability operations from our monetary policy stance. Indeed, we continued to raise the policy rate through that time.

Our Ample Reserves Framework Works Well

Turning to my second topic, our ample reserves regime has proven highly effective, delivering good control of our policy rate across a wide range of challenging economic conditions, while promoting financial stability and supporting a resilient payments system.¹⁷

In this framework, an ample supply of reserves ensures adequate liquidity in the banking system, and control of our policy rate is achieved through the setting of our administered rates—interest on reserve balances and the overnight reverse repo rate. This approach allows us to maintain rate control independently of the size of our balance sheet. That is important given large, unpredictable swings in liquidity demand from the private sector and significant fluctuations in autonomous factors affecting reserve supply, such as the Treasury General Account.

This framework has proven resilient whether the balance sheet is shrinking or growing. Since June 2022, we have reduced the size of our balance sheet by $2.2 trillion—from 35 percent to just under 22 percent of GDP—while maintaining effective interest rate control.¹⁸

Our long-stated plan is to stop balance sheet runoff when reserves are somewhat above the level we judge consistent with ample reserve conditions.¹⁹ We may approach that point in coming months, and we are closely monitoring a wide range of indicators to inform this decision.²⁰ Some signs have begun to emerge that liquidity conditions are gradually tightening, including a general firming of repo rates along with more noticeable but temporary pressures on selected dates. The Committee’s plans lay out a deliberately cautious approach to avoid the kind of money market strains experienced in September 2019. Moreover, the tools of our implementation framework, including the standing repo facility and the discount window, will help contain funding pressures and keep the federal funds rate within our target range through this transition to lower reserve levels.

Normalizing the size of our balance sheet does not mean going back to the balance sheet we had before the pandemic. In the longer run, the size of our balance sheet is determined by the public’s demand for our liabilities rather than our pandemic-related asset purchases. Non-reserve liabilities currently stand about $1.1 trillion higher than just prior to the pandemic, thus requiring that our securities holdings be equally higher. Demand for reserves has risen as well, in part reflecting the growth of the banking system and the overall economy.

Regarding the composition of our securities portfolio, relative to the outstanding universe of Treasury securities, our portfolio is currently overweight longer-term securities and underweight shorter-term securities. The longer-run composition will be a topic of Committee discussion. Transition to our desired composition will occur gradually and predictably, giving market participants time to adjust and minimizing the risk of market disruption. Consistent with our longstanding guidance, we aim for a portfolio consisting primarily of Treasury securities over the longer run.²¹

Some have questioned whether the interest we pay on reserves is costly to taxpayers. In fact, that is not the case. The Fed earns interest income from the Treasury securities that back reserves. Most of the time, our interest earnings from Treasury holdings more than cover the interest paid on reserves, generating significant remittances to the Treasury. By law, we remit all profits to the Treasury after covering expenses. Since 2008, even after accounting for the recent period of negative net income, our total remittances to Treasury have totaled more than $900 billion. While our net interest income has temporarily been negative due to the rapid rise in policy rates to control inflation, this is highly unusual. Our net income will soon turn positive again, as it typically has been throughout our history. Of course, having negative net income has no bearing on our ability to conduct monetary policy or meet our financial obligations.²²

If our ability to pay interest on reserves and other liabilities were eliminated, the Fed would lose control over rates. The stance of monetary policy would no longer be appropriately calibrated to economic conditions and would push the economy away from our employment and price stability goals. To restore rate control, large sales of securities over a short period of time would be needed to shrink our balance sheet and the quantity of reserves in the system. The volume and speed of these sales could strain Treasury market functioning and compromise financial stability. Market participants would need to absorb the sales of Treasury securities and agency MBS, which would put upward pressure on the entire yield curve, raising borrowing costs for the Treasury and the private sector. Even after that volatile and disruptive process, the banking system would be less resilient and more vulnerable to liquidity shocks.

The bottom line is that our ample reserves regime has proven remarkably effective for implementing monetary policy and supporting economic and financial stability.

Current Economic Conditions and Monetary Policy Outlook

I will close with a brief discussion of the economy and the outlook for monetary policy. Although some important government data have been delayed due to the shutdown, we routinely review a wide variety of public- and private-sector data that have remained available. We also maintain a nationwide network of contacts through the Reserve Banks who provide valuable insights, which will be summarized in tomorrow’s Beige Book.

Based on the data that we do have, it is fair to say that the outlook for employment and inflation does not appear to have changed much since our September meeting four weeks ago. Data available prior to the shutdown, however, show that growth in economic activity may be on a somewhat firmer trajectory than expected.

While the unemployment rate remained low through August, payroll gains have slowed sharply, likely in part due to a decline in labor force growth due to lower immigration and labor force participation. In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen. While official employment data for September are delayed, available evidence suggests that both layoffs and hiring remain low, and that both households’ perceptions of job availability and firms’ perceptions of hiring difficulty continue their downward trajectories.²³

Meanwhile, 12-month core PCE inflation was 2.9 percent in August, up slightly from earlier this year, as rising core goods inflation has outpaced continued disinflation in housing services. Available data and surveys continue to show that goods price increases primarily reflect tariffs rather than broader inflationary pressures. Consistent with these effects, near-term inflation expectations have generally increased this year, while most longer-term expectation measures remain aligned with our 2 percent goal.

Rising downside risks to employment have shifted our assessment of the balance of risks. As a result, we judged it appropriate to take another step toward a more neutral policy stance at our September meeting. There is no risk-free path for policy as we navigate the tension between our employment and inflation goals. This challenge was evident in the dispersion of Committee participants’ projections at the September meeting. I will stress again that these projections should be understood as representing a range of potential outcomes whose probabilities evolve as new information informs our meeting-by-meeting approach to policymaking. We will set policy based on the evolution of the economic outlook and the balance of risks, rather than following a predetermined path.

Thank you again for this award and for inviting me to join you today. I look forward to our conversation.

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1. See Christopher J. Waller (2025), “Demystifying the Federal Reserve’s Balance Sheet,” speech delivered at the Federal Reserve Bank of Dallas, Dallas, Texas, July 10. Return to text

2. For details discussed below, see Board of Governors of the Federal Reserve System (2025), Statistical Release H.4.1, “Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks (PDF)” (October 9). Return to text

3. Other liabilities include reverse repurchase agreements and accounts held by designated financial market utilities, foreign central banks, and international financial institutions. Return to text

4. Within its securities portfolio, the Federal Reserves also holds $2.3 billion in government agency debt. Return to text

5. In 2021, the standing repo facility was established to serve as a backstop in money markets to support the effective implementation of monetary policy and smooth market functioning. It is available to provide liquidity to primary dealers and eligible depository institutions through overnight repurchase agreements. The Federal Reserve also maintains U.S. dollar liquidity swap lines with several major central banks to prevent strains in global dollar funding markets from spilling over into domestic markets. The Foreign and International Monetary Authorities Repo Facility also is a source of dollar liquidity for approved foreign central banks and international monetary authorities. Beyond securities, the Fed maintains lending facilities that serve as crucial backstops for the banking system. The loans we make through these facilities show up as assets on our balance sheet, with the corresponding liability typically being reserves. Our discount window provides no-questions-asked liquidity to eligible depository institutions. In unusual and exigent circumstances, we may establish emergency liquidity facilities, in consultation with the Secretary of the Treasury. These facilities have demonstrated their critical importance in times of stress. Return to text

6. The combined peak in balances across these facilities occurred in July 2020 at just above $200 billion, including loans totaling $2.5 billion by the Primary Dealer Credit Facility, $20.6 billion by the Money Market Mutual Fund Liquidity Facility, $68.1 billion by the Paycheck Protection Program Liquidity Facility (PPPLF), $12.8 billion by the Commercial Paper Funding Facility, $41.4 billion by the Corporate Credit Facilities, $37.5 billion by the Main Street Lending Program (MSLP), $16.1 billion by the Municipal Liquidity Facility, and $8.8 billion by the Term Asset-Backed Securities Loan Facility; see Board of Governors of the Federal Reserve System (2020), Statistical Release H.4.1, “Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks” (July 2). At present, the only remaining balances from the pandemic-era emergency lending facilities are $75 million in the PPPLF and $4.1 billion in the MSLP. All other emergency lending facilities have already been fully repaid. Return to text

7. See Jerome H. Powell (2020), “Transcript of Chair Powell’s Press Conference (PDF)” (Washington: Board of Governors of the Federal Reserve System, April 29). Return to text

8. See Board of Governors of the Federal Reserve System (2020), “Federal Reserve Issues FOMC Statement,” press release, December 16, paragraph 4. Return to text

9. See, for example, Gauti B. Eggertsson and Donald Kohn (2023), “The Inflation Surge of the 2020s: The Role of Monetary Policy,” Hutchins Center Working Paper 87 (Washington: Hutchins Center on Fiscal & Monetary Policy, Brookings Institution, August); William B. English and Brian Sack (2024), “Challenges around the Federal Reserve’s Monetary Policy Framework and Its Implementation (PDF),” Brookings Papers on Economic Activity, Fall, pp. 3–26; (2024), “General Discussion (PDF),” Brookings Papers on Economic Activity, Fall, pp. 88–92; and Andrew T. Levin, Brian L. Lu, and William R. Nelson (2022), “Quantifying the Costs and Benefits of Quantitative Easing (PDF),” Economics Working Paper 22128 (Stanford, Calif.: Hoover Institution, December). Return to text

10. In December 2018, financial markets experienced significant volatility and equity prices dropped notably. While multiple factors were in play, many market participants pointed to the description of the Fed’s quantitative tightening as being on “autopilot” as exacerbating the turmoil. The “taper tantrum” was a sharp market selloff in 2013 when Chair Ben Bernanke suggested the Fed might soon reduce its asset purchases, causing Treasury yields to spike and triggering volatility in financial markets. Return to text

11. See, for example, Aaron Klein and Alan Cui (2025), “Quantitative Easing and Housing Inflation Post-COVID,” Series on Financial Markets and Regulation, Brookings Center on Regulations and Markets, October 8. Return to text

12. See, for example, Chair Bernanke’s description of the operation of balance sheet tools as part of his discussion of monetary policy in the post–Global Financial Crisis (GFC) environment: Ben S. Bernanke (2012), “Monetary Policy since the Onset of the Crisis (PDF),” speech delivered at a symposium sponsored by the Federal Reserve Bank of Kansas City, held in Jackson Hole, Wyo., August 31. Return to text

13. Research indicates that house price increases during this time reflected factors well beyond mortgage rates. For example, Mondragon and Wieland (2022) estimate that the shift to remote work explains approximately one-half of the rise in house prices during the pandemic; for more details, see John A. Mondragon and Johannes Wieland (2022), “Housing Demand and Remote Work (PDF),” NBER Working Paper Series 30041 (Cambridge, Mass.: National Bureau of Economic Research, May; revised May 2025). Return to text

14. See, for example, Mark Carlson, Stefania D’Amico, Cristina Fuentes-Albero, Bernd Schlusche, and Paul Wood (2020), “Issues in the Use of the Balance Sheet Tool,” Finance and Economics Discussion Series 2020-071 (Washington: Board of Governors of the Federal Reserve System, August). Return to text

15. Even before the taper in purchases was completed in 2022, markets were anticipating the rapid decline in the size of the balance sheet that we subsequently delivered. Those expectations were formed based on our communications, even though the anticipated pace was three times faster than our experience from 2017 to 2019. For example, the median respondents to the Survey of Primary Dealers in June 2022 anticipated that the size of the System Open Market Account (SOMA) portfolio would ultimately fall by more than $2 trillion in less than three years, from its mid-2022 level of $8.5 trillion to $6.25 trillion by 2025:Q1. See question 3b in the June 2022 dealer survey results: Federal Reserve Bank of New York, Markets Group (2022), “Responses to Survey of Primary Dealers (PDF),” June. Return to text

16. See William B. English and Brian Sack (2024), “Challenges around the Federal Reserve’s Monetary Policy Framework and Its Implementation (PDF),” Brookings Papers on Economic Activity, Fall, pp. 3–26, as well as Donald Kohn (2025), “Fed Should Be Sure to Include Monetary Policy Tools in Forthcoming Framework Review,” Brookings Commentary, January 24. Return to text

17. By contrast, before the GFC, the Fed implemented monetary policy through a fundamentally different approach, a scarce reserves regime. This system relied on complicated reserve requirements to stabilize reserve demand, as the Fed did not have the authority to pay interests on reserves. Because banks did not receive interest on reserves, they engaged in a variety of costly activities to minimize their reserve requirements. To hit the federal funds rate target, the Fed had to conduct daily open market operations to fine-tune reserve supply. That approach was operationally burdensome for both depository institutions and the Federal Reserve. It minimized systemwide liquidity consistent with the federal funds target rate, thus making the banking system more vulnerable to shocks. Unexpected swings in reserve demand at times led to excess volatility in short-term interest rates. In this scarce regime, banks relied more heavily on unsecured borrowing from other financial institutions—funding that can rapidly evaporate in times of stress, as was evident in the GFC. Return to text

18. In January 2022, the FOMC released its “Principles for Reducing the Size of the Federal Reserve’s Balance Sheet,” followed in May by more detailed plans for doing so; see Board of Governors of the Federal Reserve System (2022), “Principles for Reducing the Size of the Federal Reserve’s Balance Sheet,” press release, January 26; and Board of Governors of the Federal Reserve System (2022), “Plans for Reducing the Size of the Federal Reserve’s Balance Sheet,” May 4, press release. Return to text

19. Once balance sheet runoff has ceased, reserve balances will continue to gradually decline as other Federal Reserve liabilities grow over time. At some point, the Committee will determine that reserve balances have reached an appropriately ample level. Thereafter, the Committee will manage securities holdings as needed to maintain ample reserves over time. Return to text

20. While reserves appear to remain abundant, they are declining and will continue to do so. Since we began shrinking our balance sheet in 2022, the quantity of reserves has not changed much as the excess liquidity in the system was absorbed and then subsequently released by our overnight reverse repo facility. Now, however, balances in that facility have declined to minimal levels, so further declines in our securities holdings will translate more directly into lower reserves. Currently, reserve balances stand just below $3 trillion, or about 10 percent of GDP. By comparison, reserves as a share of GDP stood near 8 percent of GDP in early 2019, prior to the acute funding pressures that emerged later that year. Note that reserves as a share of GDP is merely indicative, not a measure of the ampleness of reserves. Assessments of where reserves stand relative to ample levels depend on a wide range of market indicators. Return to text

21. As noted in the minutes of the May 2022 FOMC meeting, the Committee could, at some point, consider sales of agency MBS to accelerate progress toward a longer-run SOMA portfolio composed primarily of Treasury securities; see Federal Open Market Committee (2022), “Minutes of the Federal Open Market Committee (PDF)” (Washington: FOMC, May 3–4). Return to text

22. See, for example, Alyssa Anderson, Dave Na, Bernd Schlusche, and Zeynep Senyuz (2022), “An Analysis of the Interest Rate Risk of the Federal Reserve’s Balance Sheet, Part 1: Background and Historical Perspective,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, July 15); and Alyssa Anderson, Philippa Marks, Dave Na, Bernd Schlusche, and Zeynep Senyuz (2022), “An Analysis of the Interest Rate Risk of the Federal Reserve’s Balance Sheet, Part 2: Projections under Alternative Interest Rate Paths,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, July 15). Return to text

23. State-level data on unemployment insurance claims during September remain available, as do some non-governmental statistics on job openings and hiring. September results regarding perceptions of employment conditions by firms and households are also available from recurring surveys, such as the National Federation of Independent Business’s Jobs Report and the Conference Board’s Consumer Confidence Survey. Return to text

The addition of tucatinib (Tukysa) to maintenance therapy with trastuzumab (Herceptin) and pertuzumab (Perjeta) displayed a statistically significant improvement in progression-free survival (PFS) vs placebo as a first-line treatment for patients with HER2-positive metastatic breast cancer, according to a news release from the drug’s developer, Pfizer Inc.¹

The investigational agent was assessed in combination with trastuzumab and pertuzumab across the aforementioned patient population in the phase 3 HER2CLIMB-05 trial (NCT05132582). The trial met its primary end point of PFS per investigator assessment, and the tucatinib-based regimen was well-tolerated, with the safety profile consistent with the established profiles of each individual agent.

“[HER2-positive] breast cancer is a particularly challenging subtype, with many patients experiencing disease progression despite effective treatments in the first-line setting,” Erika Hamilton, MD, principal investigator of HER2CLIMB-05 and director of Breast Cancer Research at the Sarah Cannon Research Institute (SCRI), stated in the news release on the study findings.¹ “The [phase 3] HER2CLIMB-05 results demonstrate that the addition of [tucatinib] to first-line maintenance therapy may further lower the risk of disease progression or death, with a treatment that has a well-established safety profile.”

The double-blind phase 3 trial enrolled patients with HER2-positive metastatic breast cancer following taxane-based induction therapy. Those who completed induction therapy with trastuzumab, pertuzumab, and a taxane with no evidence of disease progression were randomly assigned 1:1 to receive tucatinib (n = 326) or placebo (n = 328) plus trastuzumab and pertuzumab as maintenance.

Patients in both arms received trastuzumab at 6 mg/kg intravenously or 600 mg subcutaneously plus pertuzumab at 420 mg intravenously every 21 days as maintenance therapy.² Those in the investigational arm received tucatinib at 300 mg orally twice daily every 21 days, with those in the control arm receiving matching placebo.

The primary end point of the trial was investigator-assessed PFS. Secondary end points included overall survival, PFS per blinded independent central review, central nervous system PFS, health-related quality of life, and adverse effects (AEs).²

Warnings and precautions of treatment with tucatinib include severe diarrhea, dehydration, hypotension, acute kidney injury, and death. Additionally, patients may be at risk of hepatotoxicity, including alanine aminotransferase increases, aspartate aminotransferase increases, and bilirubin increases. Furthermore, tucatinib may cause embryo-fetal toxicities among patients who are pregnant or of reproductive potential.

In the phase 3 HER2CLIMB trial (NCT02614794), serious AEs were reported in 26% of the tucatinib arm, the most common of which included diarrhea (4%), vomiting (2.5%), nausea (2%), abdominal pain (2%), and seizure (2%). The most common fatal AEs included sudden death, sepsis, dehydration, and cardiogenic shock.

Dose reductions related to AEs occurred in 21% of patients, the most common of which were hepatotoxicity (8%) and diarrhea (6%).

Currently, tucatinib is approved for the treatment of patients with HER2-positive metastatic breast cancer in the third-line setting in the US as well as more than 50 countries. Additionally, it is approved by the FDA when used in combination with trastuzumab and capecitabine in adult patients with advanced unresectable or metastatic HER2-positive disease who received at least 1 prior HER2-based treatment in the metastatic setting in April 2020.³

“The positive results from HER2CLIMB-05, combined with [tucatinib’s] known safety profile in later-line settings, underscore its potential to play a meaningful role in front-line maintenance, where it may benefit a broader population of patients with [HER2-positive] disease,” Johanna Bendell, MD, chief development officer of Oncology at Pfizer, expressed in the news release.¹ “We are grateful to the patients and investigators who contributed to this important research.”

References

1. TUKYSA combination significantly improves progression-free survival as first-line maintenance in HER2+ metastatic breast cancer in HER2CLIMB-05 trial. News release. Pfizer Inc. October 14, 2025. Accessed October 14, 2025. https://tinyurl.com/3xc5xb5d
2. A study of tucatinib or placebo with trastuzumab and pertuzumab for metastatic HER2+ breast cancer (HER2CLIMB-05). ClinicalTrials.gov. Updated October 14, 2025. Accessed October 14, 2025. https://tinyurl.com/3w2d454n
3. FDA approves tucatinib for patients with HER2-positive metastatic breast cancer. News release. FDA. April 17, 2020. Accessed October 14, 2025. https://tinyurl.com/ppzb6mnx

London: Cleveland Clinic brought together global leaders in biotechnology, healthcare, academia, government and industry at today’s Life Science Summit to explore the transformative forces shaping the future of therapeutics.

During the international event – held at the Lanesborough Hotel near Cleveland Clinic London – Cleveland Clinic leaders also announced several new or expanded collaborations and shared details about Cleveland Clinic London’s new cancer centre.

The summit highlighted advancements in areas such as AI-driven drug discovery, personalized medicine and cancer treatments, offering attendees unique insights into the science, strategy and societal impact of modern medicine. With a dynamic mix of keynote addresses, scientific presentations and panel discussions, the event was designed to foster collaboration and highlight opportunities to fast-track the translation of research into transformative therapies.

“The Life Science Summit reflects our commitment to advancing medicine across the globe through innovation and collaboration,” said Tom Mihaljevic, M.D., CEO and President of Cleveland Clinic and holder of the Morton L. Mandel CEO Chair. “By bringing together international leaders from across disciplines, we aim to foster meaningful dialogue and accelerate progress in developing treatments that improve the lives of patients around the world.”

Panel discussions focused on topics such as AI, precision medicine, and next-generation therapies, as well as trends in life sciences investment. Highlighted sessions included:

• Leveraging AI in Therapeutics: Use of generative models, automation and real-world data, as well as challenges like data quality, regulation and ethics. The session highlighted the importance of cross-sector collaboration in harnessing AI’s potential in transforming therapeutics.
• Therapeutics in Oncology: Key trends shaping cancer therapeutics, highlighting innovation, translation and clinical impact. Experts from academia, biotech and healthcare discussed breakthroughs, emerging targets and strategies to accelerate new treatments.
• Future of Tailored Therapeutics: A discussion on how genomics, AI and tailored therapeutics are advancing healthcare with precise diagnostics, personalized treatments and improved patient outcomes.
• Investors Forum: Insights into life sciences IPOs and the rising demand for breakthrough therapies and precision medicine.
• Biotech in Britain: A look at innovation, investment and policy fueling the UK’s biotech sector.

The summit also featured a Cleveland Clinic Portfolio Showcase, highlighting cutting-edge therapies and technologies being developed through Cleveland Clinic Innovations.

Other new partnerships and updates were shared during the event and highlighted Cleveland Clinic’s steadfast progress in expanding state-of-the-art clinical care and robust life sciences research in the UK. These included:

• New collaboration with Khosla Ventures: Cleveland Clinic and Khosla Ventures announced a strategic collaboration that connects the international health system with one of Silicon Valley’s leading investors in healthcare and technology. The new relationship combines the organizations’ unique strengths, aiming to reimagine healthcare delivery and create solutions that address some of the most pressing challenges in the field.
• Expanded collaboration with LifeArc: Building on a successful relationship since 2019, Cleveland Clinic and LifeArc, a UK-based self-funded medical research organisation, have identified new areas of mutual interest and will work together to drive innovation in key fields, including the development of new monoclonal antibody-based treatments and the provision of continuous education to clinician scientists. Through this new agreement, the organizations aim to create a robust pipeline for translating laboratory discoveries into life-changing treatments for patients.
• Discussion of cancer services in London with the construction of new cancer centre: As the latest Cleveland Clinic London location, offering one of the most comprehensive cancer programs in the UK Independent market, the new cancer centre will deliver the most advanced treatments. Multidisciplinary cancer care will include surgical oncology, medical oncology and haematology including systemic cancer therapies, such as immunotherapy, chemotherapy, targeted therapies and radiotherapy tailored to each patient. Construction is slated to begin in the fourth quarter of 2025, with completion anticipated by the end of 2027.

As part of a global research enterprise, Cleveland Clinic London has made clinical research an integral component of daily operations, achieving several firsts in the UK private healthcare sector. Currently, 46 investigator-sponsored and commercial studies are open across all major specialties, with over 1,000 patients recruited to clinical trials by the end of 2024, including NHS portfolio multicentre studies. Additionally, Cleveland Clinic London caregivers authored more than 1,100 peer-reviewed papers in 2024.

Building on Cleveland Clinic’s partnership with IBM and the Science and Technology Facilities Council, Cleveland Clinic London is advancing AI-driven research to improve patient outcomes. In a pilot study, a research team is examining how common hospital procedures impact overall health and quality of life. Researchers are using clinical and advanced imaging data provided by Cleveland Clinic London BioResource, a repository which provides patients with the opportunity to consent to enhanced longitudinal data collection and analysis. Researchers aim to develop sophisticated AI models for multi-disease analysis, ultimately enhancing understanding and care for patients.

The Life Science Summit was supported by sponsorships from AstraZeneca, Bank of America, and Flagship Pioneering, as well as Jones Day and LifeArc.

The American hardware industry is undergoing a renaissance. New players are emerging across aerospace, automotive, defense, and beyond—and they must iterate more quickly, and with more complexity, than ever before. Just as software developers needed new tools to move from a waterfall framework to the more flexible agile approach, hardware now needs a different type of collaborative platform—one that can instantly align requirements across systems to build safely, reliably, and quickly. 

That’s why Flow Engineering is poised to have a generational impact.

Whether it’s an electric vehicle, a rocket, or a robot, building complex hardware requires full context throughout the system: changing the thermal parameters for a single component, for example, can have a ripple effect through the rest of the design. But the legacy products used to track these requirements are clunky artifacts of a bygone era and simply don’t measure up. Engineers are reluctant to use them, and they make development cycles, already famously long in hardware, even longer.

Today’s electric vehicles have more in common with computers than internal combustion vehicles. And Flow founder Pari Singh knows that, like software, hardware’s future is agile. His insights are making Flow the default requirements management platform for the next generation of hardware companies.

Built specifically for agile hardware teams, Flow serves as a modern system of record, automatically verifying changes and propagating them downstream. Its magic lies in the collaboration it enables. Flow feels natural and intuitive for systems engineers and their domain-specific colleagues alike, and integrates with a full suite of engineering tools. Teams can break down silos and iterate continuously, working together and with outside partners in real time, all from a single source of truth. As with software development, these shorter feedback loops dramatically reduce time to market—which gives Flow’s customers a critical competitive advantage.

Born and raised in London and obsessed with engineering from a young age, Pari was a 22-year-old Imperial College graduate when he launched a design consultancy for hybrid rocket engines. He built a tool to do in two hours what took others twelve weeks. This led to the innovative idea behind Flow. As we at Sequoia have gotten to know Pari, we’ve found him to be clear-thinking, driven, and resilient. He is also relentless in his pursuit of top talent and building a truly special team—which is fortunate given the company’s rapid growth.

Flow is working with top companies across space, defense, nuclear, aero, and robotics, including Rivian, Joby, Astranis, and Radiant Nuclear. As this next generation of hardware businesses continues to scale, we at Sequoia are pleased to lead the Series A to help Flow accelerate their success. The team is hiring now both in London and at their new HQ in San Francisco.

Through the combined effort of systems engineers and their colleagues, a collection of pumps, valves, and pipes can become a spaceship—and the future of hardware engineering itself will require the same kind of extraordinary collaboration. In this industry-wide effort to build the hardware of tomorrow, we believe Pari and the team at Flow are leading the way.

Check Point Software Technologies Ltd. (NASDAQ: CHKP), a pioneer and global leader of cyber security solutions, today announced its inclusion in Fast

Company’s Next Big Things in Tech 2025 list. This prestigious recognition highlights Check Point’s innovation in securing and protecting public blockchains from emerging cyber threats.

“At Check Point, innovation isn’t just about keeping up — it’s about staying ahead,” said Roi Karo, Chief Strategy Officer at Check Point. “Just as Check Point’s original Firewall-1 secured the early internet, our blockchain solution protects the decentralized future, offering enterprise-grade, compliance-ready security for a safer blockchain ecosystem. We’re proud that Fast Company recognizes our mission to bring real-time threat detection and prevention to the blockchain, ensuring trust, transparency, and safety across the decentralized world.”

Check Point’s inclusion on the list highlights its groundbreaking work in real-time blockchain threat prevention — a first-of-its-kind capability now active on the Cardano mainnet, among others. This innovation marks a fundamental shift from reactive threat detection to proactive, in-chain prevention, protecting users, digital assets, and infrastructure before cyber attacks can occur. Check Point’s solution combines bold thinking with deep technical commitment to adapt enterprise-grade protection to decentralized ecosystems.

Fast Company’s Next Big Things in Tech 2025 honorees represent a diverse array of technologies developed by established companies, startups, and research teams. These innovations are featured for their potential to revolutionize the lives of consumers, businesses, and society overall.

“Next Big Things in Tech is both a snapshot of the most interesting tech of the moment and a crystal ball that predicts the next several years,” said Brendan Vaughan, Editor-in-Chief of Fast Company. “We’re excited to share this list with our readers, and we congratulate the winners for their vision and innovation.”

In addition to being honored on Fast Company’s Next Big Things in Tech 2025 list, Check Point has been recognized as one of the World’s Best Companies of 2025 by TIME and Statista, one of America’s Best Cybersecurity Companies by Newsweek and Statista and included on Fast Company’s World Changing Ideas 2024 list, among other accolades.

Learn more about Check Point’s Blockchain Security solution here.

Follow Check Point on LinkedIn, X (formerly Twitter), Facebook, YouTube and our blog. 

About Check Point Software Technologies Ltd. 

Check Point Software Technologies Ltd. (www.checkpoint.com) is a leading protector of digital trust, utilizing AI-powered cyber security solutions to safeguard over 100,000 organizations globally. Through its Infinity Platform and an open garden ecosystem, Check Point’s prevention-first approach delivers industry-leading security efficacy while reducing risk. Employing a hybrid mesh network architecture with SASE at its core, the Infinity Platform unifies the management of on-premises, cloud, and workspace environments to offer flexibility, simplicity and scale for enterprises and service providers.

Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to our expectations regarding  our products and solutions and Lakera’s products and solutions, our ability to leverage Lakera’s capabilities and integrate them into Check Point, our ability to deliver end-to-end AI security stack, our foundation of the new Check Point’s Global Center of Excellence for AI Security, and the consummation of the acquisition. Our expectations and beliefs regarding these matters may not materialize, and actual results or events in the future are subject to risks and uncertainties that could cause actual results or events to differ materially from those projected. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed with the Securities and Exchange Commission on March 17, 2025. The forward-looking statements in this press release are based on information available to Check Point as of the date hereof, and Check Point disclaims any obligation to update any forward-looking statements, except as required by law.